"Is Ubuntu an operating system? Last week at EuroOSCON, Mark Shuttleworth gave the closing keynote outlining what he believes are the major struggles faced by the open-source/free-software community. During his talk, it became clear that Ubuntu is trying to achieve a radical shift in the software world. Ubuntu isn't trying to be a platform for mass-market application software: it is trying to be the primary provider of both the operating system and all the application software that a typical user would want to run on his machine. Most Linux distributions are like this, and I think it is a dangerous trend that will stifle innovation and usability."

Distro's ship everything plus the kitchen sink and it's bad for business. But it's not because of some paradigm shift, rather the same basic problem Linux has always had : methods of installing third party software on Linux is broken

No, they are not broken. I still can install these old Loki games (using the Loki installer) on my latest Linux install, and guess what, they even work !
Packages work too.

Those who dare and venture out of the realm of packages blessed by their distro for that particular release of their OS find themselves in the quagmire of compiling from source, dependancy hell, incompatibility, etc which dwarf any problems on other platforms

So you admit that the OS vendor's repository brings stability and support.
If you use another vendor's packages (no need to compile anything, dependancy hell and incompatibility depends on the package), of course, you can't blame your distro vendor, nor the repository.
What you say is pure BS. At worst, even if your ISV package causes dependancy hell, it will still be better than in Windows for example, as at least you will be able to uninstall the package correctly.

Sure there is hope. Klik is nice for example, but untill all major Linux distros get together on an easy way for independants to distribute their software to Linux users they will never get the mainstream acceptance they seek

And yet, Google and Adobe, even Netscape, manage to make software install on Linux. Those that use Loki installer too.

Edit: I agree with the author Mac-style app bundles would rock on Linux, unfortunately most oss developers seem to suffer from an extreem version of NIH-syndrome - NIBM (Not Invented By Me)

I rather think that people like you complain about things they are clueless about. Like saying Mac-style bundles is a every good thing that has no problems, or saying it would rock on Linux. No it would not rock at all, especially when every app has to load the very same code because they duplicate libraries (which defeats their purpose).